Plummet in autumn real estate sales anticipated by 30%
The real estate market in Taiwan is experiencing some significant shifts, with the Financial Supervisory Commission making a notable decision to exclude first-home mortgages from the 30% cap on housing loans. This move is aimed at making it easier for first-time homebuyers to secure mortgages.
In addition, the central bank is reportedly considering exempting first-home mortgages from anti-loan concentration rules, another potential boost for first-time buyers. This decision, if implemented, would align with the efforts of banks such as CTBC Bank and Taipei Fubon Bank, which have already reduced the mortgage loan-to-value ratio for first-time homebuyers from 85% to 70% since September last year.
However, the number of large-scale developments in Taipei has decreased noticeably from the previous year and the spring sales season, affecting overall totals. This trend is not limited to Taipei, as Taoyuan also has projects of more than NT$10 billion in total in northern districts such as Bade and Gueishan. New Taipei City, in particular, has 55 projects, led by a major office development in Sinjhuang District by Highwealth Construction Corp and a large residential complex in Sanchong District by JSL Group.
A survey by FBS Internet Technology Co showed that a significant number of first-home buyers might sell presale houses upon delivery if they fail to secure adequate mortgages. This could potentially lead to a decrease in the number of completed projects.
The survey also revealed that about 34% of respondents said they would approach multiple lenders, while 29.2% would turn to family or friends for financial support. Nearly 11% said they might default, raising concerns about potential financial risks. If all else fails, 7.5% said they would resort to high-interest unsecured loans, while 1.7% would consider underground lenders.
These developments highlight the challenges faced by first-time homebuyers in Taiwan and the need for continued support and flexible policies to help them navigate the real estate market. It's a complex situation that requires careful consideration and balanced decisions to ensure the stability of the market while providing opportunities for first-time homebuyers.
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